(BRUSSELS) - The European Commission granted Poland on Wednesday almost two months to work out new plans to salvage two historic Polish shipyards after Prime Minister Donald Tusk pressed for more time.

Following Polish promises to present a viable, alternative plan by September 12, the commission said it was postponing a state-aid decision on the Gdynia and Szczecin shipyards, which could have threatened them with bankruptcy.

However, the commission rejected Warsaw's latest restructuring plans, without which Europe's state-aid watchdog cannot consider past public support to the yards as legal.

"The restructuring plans on the table today are not acceptable for the commission because they would not achieve that objective," EU Competition Commissioner Neelie Kroes said in a statement.

"Nevertheless, in view of ongoing negotiations with potential buyers of the two yards, and of the commitment of Prime Minister Tusk that new restructuring plans will be submitted by 12th September, the formal adoption of the negative decision is postponed," she added.

The two struggling shipyards on Poland's Baltic coast received various aid measures worth over two billion euros since Poland joined the European Union in 2004, according to the commission.

Under EU rules, such state support must be accompanied by restructuring or privatisation plans aimed at making shipyards economically viable in order to avoid state bail-outs that could distort competition.

However, the Polish government has repeatedly failed to produce plans that satisfy the commission, which has threatened to order Warsaw to recover past aid in the absence of a serious restructuring.

Commission spokesman Jonathan Todd said "we have to balance the interests" of keeping the yards open and protecting jobs and "treat all shipyards in all member states in an even-handed manner and we have to ensure that no shipyard gains an unfair competitive advantage."

The commission justified its decision to grant Poland yet again more time by saying that Tusk had said there were advanced talks under way with potential investors and new restructuring plans should be ready by September 12.

"We have now entered the second half of extra time and it is essential that the Polish authorities use this final opportunity to come up with solutions that will guarantee the viability of the shipyards without undue subsidies," Kroes said.

After raising the shipyards' fate with commission chief Jose Manuel Barroso on Tuesday, Tusk said he was no longer planning to turn directly to Poland's fellow EU member states, who as a group can take decisions on state aid -- a threat he had made on Monday.

Poland's Baltic coast shipyards at Szczecin, Gdynia and Gdansk are etched in the national mind because dozens of people were killed there when security forces fired on workers demonstrating against food price rises in 1970.

The Gdansk yard has added importance because it was the cradle of Solidarity, the trade union movement which was born during a strike in 1980 and which in 1989 helped bring down Poland's regime and the communist bloc overall.

The commission has also targetted state aid to Gdansk, but already gave Warsaw until September for new restructuring plans because that yard's privatisation was under way.

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